EMPLOYMENT AGREEMENT
Exhibit 10.10
This Employment Agreement (the "Agreement") is effective as of March 29, 2016, by and between Biohaven Pharmaceutical, Inc., a Delaware corporation (the "Company"), and Xxxx Xxxxxx, an individual resident of the State of Connecticut (the "Executive").
WHEREAS, the Company and Executive desire to enter into this Agreement pursuant to which the Company will employ Executive in the capacity, for the period and on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements herein contained, the parties hereby agree as follows:
1. EMPLOYMENT AND DUTIES. The Company hereby employs Executive and Executive hereby accepts such employment in the capacity of Chief Commercial Officer of the Company to act in accordance with the terms and conditions hereinafter set forth. During the Term (as defined below), Executive will report to the CEO, and agrees that he will devote time, attention and skills to the operation of the Business (as defined below) of the Company and that he will perform such duties, functions, responsibilities and authority in connection with the foregoing as are from time to time delegated to Executive by the CEO. These duties shall include, but shall not be limited to, responsibility for the Company’s commercialization and sales of pharmaceutical drugs and strategic planning, preparing for drug approvals and commercialization that are in compliance with global regulatory and health agencies, representing the Company in dealings with investors and the public, executing deliverables and an operating plan, and other tasks delegated by the CEO. For purposes of this Agreement, the “Business” of the Company shall be defined as the development and commercialization of neuropsychiatric drug candidates and related technology based products. Executive is not bound by the terms of any agreement with any previous employer or other party which would limit his abilities to perform his duties and obligations hereunder.
2. TERM. The term of this Agreement shall commence on the date hereof and shall continue for a period of three (3) years (the “Initial Term”). Thereafter, this Agreement shall be automatically renewed for one year periods, unless otherwise terminated by the Executive upon written notice to the other given not less than ninety (90) days prior to the next anniversary of the Agreement. The Initial Term and any renewals thereof shall be referred to herein as the "Term."
3. COMPENSATION. In consideration of all the services to be rendered by Executive to the Company hereunder, the Company hereby agrees to pay or otherwise provide Executive the following compensation and benefits. It is furthermore understood that the Company shall have the right to deduct or withhold under any provision of applicable law (including but not limited to Social Security payments, income tax withholding and other required deductions not in effect or which may become effective by law any time during the Term) from:
(a) SALARY. Executive shall receive an initial annual salary of Two Hundred Sixty Five Thousand Dollars ($265,000), plus annual cost of living salary increases ("Base Salary"). The applicable Base Salary shall be reviewed by the Board each year prior to the anniversary of this
Agreement to determine the annual increase to the applicable year’s Base Salary; provided,however, that in no event shall such annual increase be less than cost of living increase. The applicable Base Salary will be paid in equal installments not less frequently than bi-monthly in accordance with the Company's salary payment practices in effect from time to time for senior executives of the Company.
(b) BONUS PAYMENT. In addition to the Base Salary then in effect, Executive shall be eligible to receive a bonus payment (the "Bonus Payment") with a target of thirty-five percent (35%) of the applicable year’s Base Salary (the "Bonus Percentage") based upon Executive achieving performance objectives as determined each year by the Board of Directors. The Bonus Payment will be paid in accordance with the Company's bonus payment practices in effect from time to time for senior executives of the Company. The Board shall review the Executive's Bonus Percentage annually and may, in the Board's sole discretion, increase the Bonus Percentage based upon the Company's and Executive's performance.
(c) FRINGE BENEFITS ALLOWANCE. As of the date hereof, the Company and Executive acknowledge that the Company does not currently have benefit plans in place for health, dental, retirement or otherwise. The Company shall provide Executive with up to 20% of the Executive’s Base Salary to reimburse Executive for health, dental, welfare plans and retirement plans. In the event that, after the effective date of this Agreement, the Company provides Executive with such benefits, the Company’s cost for such benefits will be netted out of such 20% Fringe Benefit Allowance. The allowance is in addition to the Base Salary, Bonus and other compensation to which Executive from time to time may be entitled hereunder. Executive’s right to be reimbursed for business-related expenses is separate and Executive is not required to apply the allowance to any such expenses.
(d) EXPENSES. Executive shall be entitled to be reimbursed for all reasonable expenses incurred by him in connection with the fulfillment of his duties hereunder, including all necessary continuing education and certification costs and related expenses; provided, however, that Executive has obtained the Company's prior written approval of such expenses and has complied with all policies and procedures related to the reimbursement of such expenses as shall, from time to time, be established by the Company.
(e) VACATIONS AND SICK LEAVE. Executive shall be entitled to Four (4) weeks paid vacation annually to be taken in accordance with the Company's vacation policy in effect from time to time and at such time or times as may be mutually agreed upon by the Company and Executive; provided, however, that if for any reason Executive does not take the full Four (4) weeks’ vacation in any given year, Executive shall be entitled to accrue and carry over such vacation time according to the policy established by the Company. Executive shall also be entitled to sick leave according to the sick leave policy which the Company many adopt from time to time.
4. INDEMNIFICATION.
(a) COMPANY'S OBLIGATION TO INDEMNIFY. The Company shall at all times during the Term and thereafter, indemnify and defend and hold Executive harmless from and
against all liability, loss, costs, claims, damages, expenses, judgments, awards, and settlements as well as attorneys' fees and expenses, personal or otherwise, whether in tort or in contract, law or equity, that the Company or the Executive may incur by reason of or arising out of any claimmade by any third party (together, the "Losses"), with respect to Executive's employment with Company in accordance with this Agreement; provided, however, that the Company's foregoing indemnification obligations shall not apply to Losses incurred by the Company as a result of the Executive's willful misconduct, gross negligence, conviction of a felony (including entry of a plea of nolo contendere) for illegal or criminal behavior or engagement in activities beyond the scope of his employment hereunder. Indemnification shall include all costs, including actual attorneys' fees and expenses reasonably incurred in pursuing indemnity claims under or enforcement of this Agreement.
(b) EXECUTIVE'S OBLIGATION TO INDEMNIFY. Executive shall also at all times during the term of this Agreement and thereafter, indemnify and defend and hold Company, its founders, owners, directors, officers, employees, advisors, agents, partners, service providers and affiliates harmless from and against all Losses with respect to the Executive's willful misconduct, gross negligence, conviction of a felony (including entry of a plea of nolo contendere) for illegal or criminal behavior or engagement in activities beyond the scope of his employment hereunder during the Executive's employment with Company in accordance with this Agreement. Indemnification shall include all costs, including reasonable attorneys' fees and expenses reasonably incurred in pursuing indemnity claims under or enforcement of this Agreement.
5. LIMITATION OF LIABILITY. EXECUTIVE AGREES THAT REGARDLESS OF THE FORM OF ANY CLAIM, EXECUTIVES' SOLE REMEDY AND COMPANY OBLIGATION WITH RESPECT TO ANY CLAIMS MADE RELATED TO OR ARISING OUT OF THIS AGREEMENT SHALL BE GOVERNED BY THIS AGREEMENT, AND IN ALL CASES EXECUTIVE'S REMEDIES SHALL BE LIMITED SPECIFICALLY TO COMPANY AND NOT TO ASSETS OR PERSONAL AND BUSINESS INTERESTS OF COMPANY FOUNDERS, OWNERS, DIRECTORS, OFFICERS, EMPLOYEES, ADVISORS, PARTNERS AND AFFILIATES. IT IS EXPRESSLY AGREED THAT IN NO EVENT SHALL COMPANY, ITS FOUNDERS, OWNERS, DIRECTORS, OFFICERS, EMPLOYEES, ADVISORS, PARTNERS AND AFFILIATES BE LIABLE FOR PERSONAL, INCIDENTAL, DIRECT, INDIRECT, OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGE OR INJURY TO PROPERTY AND LOST PROFITS REGARDLESS OF WHETHER COMPANY SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY.
6. TERMINATION.
(a) EVENTS OF TERMINATION. This Agreement shall terminate on the earliest to occur of the following events:
(i) the expiration of the Term;
(ii) the mutual written agreement of the Company and the Executive;
(iii) the voluntary termination of the Executive other than as a result of a Constructive Termination Event (as defined herein);
(iv) the death of Executive or Executive's retirement;
(v) Executive becoming completely unable to perform his duties as described herein due to injury, illness or disability (mental or physical), as determined by an independent physician selected with the approval of the Company and Executive, for a period of three (3) consecutive months ("Disability"); or
(vi) the termination of the Executive by the Company for "just cause" (as defined herein) upon giving written notice to Executive
For the purposes hereof, the Company shall have "just cause" to terminate Executive's employment hereunder as a result of Executive's gross negligence, willful misconduct, conviction of a felony (including the entry of a plea of nolo contendere) for illegal or criminal behavior in carrying out his duties as required pursuant to the terms of the Agreement. Notwithstanding any other provision contained herein, the Company shall have the right to terminate the agreement and Executive's employment without just cause, and Executive's remedies hereunder in the event of such termination shall be limited to the Severance Payments set forth in Section 7 hereof.
(b) TERMINATION FOR JUST CAUSE OR VOLUNTARY TERMINATION. If Executive's employment is terminated prior to the expiration of the Term for just cause or if Executive's employment is terminated as set forth in Section 6(a) (ii) or (iii) hereof, Executive shall NOT be entitled to receive any Severance Payments (as defined in Section 7 below) and will only be entitled to receive any accrued but unpaid portion of the applicable Base Salary, plus any accrued but unused vacation time and unpaid expenses (in accordance with Sections 3(d) and (e) hereof) that have been earned by the Executive as the date of such termination.
(c) TERMINATION WITHOUT JUST CAUSE. If Executive's employment is terminated by the Company without just cause or as a result of the Executive's Disability, Executive shall be entitled to receive the Severance Payments described in Section 7 hereof. For purposes of the Agreement, termination without just cause shall include termination by Executive of his employment with the Company within one hundred and twenty (120) days after the occurrence of any of the following events which are not remedied within ten (10) business days after written notice to the Company by Executive of such event:
(i) failure to maintain Executive in the office to the position of Chief Commercial Officer or a substantially equivalent office or position, of or with the Company;
(ii) a significant adverse change in the nature or scope of the authority, powers, functions, Base Salary, responsibilities or duties attached to the position of Executive with the Company as set forth herein or a reduction in Executive's then-applicable Base Salary and benefits as set forth herein;
(iii) the liquidation, dissolution, merger, consolidation or reorganization of the Company or transfer of all or a significant portion of its business and/or assets, unless the successor or successors shall have assumed all duties and obligations of the Company under the Agreement;
(iv) the Company shall relocate its principal headquarters offices or require Executive to have his principal location of work changed to any location which is inexcess of fifty (50) miles from its current location without the prior written consent of Executive; and
(v) any material breach of the Agreement by the Company or its successors.
(d) INSURANCE. The Company may secure, in its own name, or otherwise, and at its own expense, life, health, accident and other insurance covering Executive or Executive and others. Executive agrees to assist the Company in procuring such insurance by submitting to the usual and customary medical and other examinations and by signing, as the insured, such applications and other instruments in writing as may be reasonably requires by the insurance companies to which application is made pursuant to such insurance. Executive agrees that he shall have no right, title, or interest in or to any insurance policies or to the proceeds thereof which the Company many so elect to take out or to continue on the Executive's life.
7. SEVERANCE PAYMENT. (a) If the Company terminates Executive's employment without just cause or if Executive's employment is terminated due to Disability, Executive shall be entitled to receive, in addition to the applicable Base Salary, plus any accrued but unused vacation time and unpaid expenses (in accordance with Sections 3(d) and (e) hereof) that have been earned by the Executive as of the date of such termination (“Termination Date”), the following severance payments (the "Severance Payments"):
(i) equal monthly installments at the applicable Base Salary rate then in effect, as determined on the first day of the calendar month immediately preceding the day of termination, to be paid beginning on the first day of the month following such Termination Date and continuing six (6) months following the Termination Date (the "Severance Period"); and
(ii) during the Severance Period, health and life insurance benefits substantially similar to those which Executive was receiving or entitled to receive immediately prior to termination; provided, however, such insurance benefits shall be reduced to the extent comparable benefits during such period following Executive's Termination Date, and any benefits actually received by Executive shall be reported by Executive to the Company.
(iii) all stock options held by the Executive will be deemed fully vested and exercisable on the Termination Date and the exercise period for such stock options will be increased by a period of two years from the Termination Date.
(b) DISABILITY. Whenever Severance Payments are payable to Executive hereunder during a time when Executive is partially or totally disabled, and such Disability would entitle
him to disability income payments according to the terms of any plan or policy now or hereafter provided by the Company, the Severance Payments payable to Executive hereunder shall be inclusive of any such disability income and shall not be in addition thereto, even if such disability income is payable directly to Executive by an insurance company under a policy paid for by the Company
8. RESTRICTIVE COVENANTS. Executive and the Company agree that the Company would suffer irreparable harm and incur substantial damage if Executive were to enter intoCompetition (as defined herein) with the Company. Therefore, in order for the Company to protect its legitimate business interests, Executive agrees as follows:
(a) Without the prior written consent of the Company, Executive shall not, during the period of employment with the Company, directly or indirectly, invest or engage in any business that is Competitive (as defined herein) with the Business of the Company or accept employment or render services to a Competitor (as defined herein) of the Company as a director, officer, agent, employee or consultant or solicit or attempt to solicit or accept business that is Competitive with the Business of the Company, except that Executive may own up to five percent (5%) of any outstanding class of securities of any company registered under Section 12 of the Securities Exchange Act of 1934, as amended; provided, however, the Company acknowledges that Executive currently engages in a number of activities set forth on Exhibit A as long as such permitted activities do not have a material adverse effect on the Executive’s performance or this Agreement.
(b) Without the prior written consent of the Company and upon any termination of Executive's employment with the Company and for a period of six (6) months thereafter, Executive shall not, either directly or indirectly, (i) invest or engage in any business that is Competitive (as defined herein) with the Business of the Company, except that Executive may own up to five percent (5%) of any outstanding class of securities of any company registered under Section 12 of the Securities Exchange Act of 1934, as amended, (ii) accept employment with or render services to a Competitor of the Company as a director, officer, agent, employee or consultant unless he is serving in a capacity that has no relationship to that portion of the Competitor's business that is Competitive with the Business of the Company, or (iii) solicit, attempt to solicit or accept business Competitive with the Business of the Company from any of the customers of the Company at the time of his termination or within twelve (12) months prior thereto or from any person or entity whose business the Company was soliciting at such time.
(c) Upon termination of his employment with the Company, and for a period of twelve (12) months thereafter, Executive shall not, either directly or indirectly, engage, hire, employ or solicit in any manner whatsoever the employment of an employee of the Company.
(d) For purposes of this Agreement, a business or activity is in "Competition" or "Competitive" with the Business of the Company if it involves, and a person or entity is a "Competitor", if that person or entity is engaged in, or about to become engaged in, the research, development, design, manufacturing, marketing or selling of a specific product or technology that resembles, competes, or is designed to compete, with, or has applications similar to any product or technology for which the Company has obtained or applied for a patent or made
disclosures, or any product or technology involving any other proprietary research or development engaged in or conducted by the Company during the term of Executive's employment with the Company.
9. DISCOVERIES AND INVENTIONS. Executive hereby assigns to the Company all his right, title, and interest in and to any and all inventions, discoveries, developments, improvements, techniques, designs and data related to the technology which Executive conceives of, reduces to practice, or otherwise creates, either alone or jointly with others, in the course of his employment hereunder and in which the law recognizes any protectable interest.
10. CONFIDENTIALITY. Executive shall not use, or disclose any of the Confidential Information and Trade Secrets, either during the Term of his employment or at any time thereafter, except as required in the course of his employment. For purposes of this Agreement, "Confidential Information and Trade Secrets" shall mean all information, know how, trade secrets, processes, computer software or programs and related documentation, methods, practices, fabricated techniques, marketing plans, and other compilations of information which relate to the Business of, and are owned by the Company which were not known generally to others engaged in the Business of the Company and which the Company has taken affirmative actions to protect from public disclosure or which do not exist in the public domain. All Confidential Information and Trade Secrets relating to the Business of the Company shall remain the exclusive property of the Company unless owned by Executive.
11. NOTICES. Any notice or other communication required or permitted to be given hereunder shall be in writing and deemed to have been given when delivered in person or when dispatched by telegram, electronic mail, or electronic facsimile transfer (confirmed in writing by mail, registered or certified, return receipt requested, postage prepaid, simultaneously dispatched) to the addressees at the addresses specified below.
| If to Executive: | Xxxx Xxxxxx | ||||
| [***] | |||||
| [***] | |||||
| [***] | |||||
| If to the Company: | Xxxx Xxxxx, CEO | ||||
| Biohaven Pharmaceutical, Inc. | |||||
| 000 Xxxxxx Xxxxxx | |||||
| Xxxxx 000 | |||||
| Xxx Xxxxx, XX 00000 | |||||
| with a copy to: | Xxxxxxx X. Xxxx | ||||
| Xxxxx Lord LLP | |||||
| 0000 Xxxxxxxxx Xxxxx | |||||
| Xxxxxxxxxx, XX 00000 | |||||
| [***] | |||||
or to such other address or fax number as either party may from time to time designate in writing to the other.
12. ENTIRE AGREEMENT. This Agreement, together with Exhibit A, constitutes the entire agreement between the parties hereto relating to the subject matter hereof, and supersedes all prior agreements and understandings, whether oral or written, with respect to the same. No modification, alteration, amendment or revision of or supplement to this Agreement shall be valid or effective unless the same is in writing and signed by both parties hereto.
13. GOVERNING LAW. This Agreement and the rights and duties of the parties hereunder shall be governed by, construed under and enforced in accordance with the laws of the State of Connecticut.
14. ASSIGNMENT. The rights and obligations of the parties under this Agreement shall not be assignable without written permission of the other party
15. SEVERABILITY. The invalidity of any provision of this Agreement under the applicable laws of the State of Connecticut or any other jurisdiction, shall not affect the other provisions hereby declared to be severable from all other provisions. The intention of the parties, as expressed in any provision held to be void or ineffective shall be given such full force and effect as may be permitted by law.
16. SURVIVAL. The obligations of the Company or its successor to pay any Severance Payments required hereunder subsequent to the termination of this Agreement and the obligations of Executive under Sections 6, 7 and 8 hereof shall survive the termination of this Agreement.
17. REMEDIES. Executive and the Company recognize that the services to be rendered under this Agreement by Executive are special, unique, and of extraordinary character, and that in the event of the breach by Executive of the terms and conditions of Sections 4, 5, 8, 9 and 10 hereof the Company shall be entitled, if it so elects, to institute and prosecute proceedings in any court of competent jurisdiction, to obtain damages for any breach thereof.
18. DISPUTE RESOLUTION. Except for the right of either party to apply to a court of competent jurisdiction for a temporary restraining order, a preliminary injunction, or other equitable relief to preserve the status quo or prevent irreparable harm, any and all claims, disputes or controversies arising under, out of, or in connection with the Agreement, including any dispute relating to production, use or commercialization, which the parties shall be unable to resolve within sixty (60) days shall be mediated in good faith. The party raising such dispute shall promptly advise the other party of such claim, dispute or controversy in a writing, which describes in reasonable detail the nature of such dispute. By not later than five (5) business days after the recipient has received such notice of dispute, each party shall have selected for itself a representative who shall have the authority to bind such party, and shall additionally have advised the other party in writing of the name and title of such representative. By not later than ten (10) business days after the date of such notice of dispute, the party against whom the dispute shall be raised shall select a mediation firm in Connecticut and such representatives shall
schedule a date with such firm for a mediation hearing. The parties shall enter into good faith mediation and shall share the costs equally. If the representatives of the parties have not been able to resolve the dispute within fifteen (15) business days after such mediation hearing, the parties shall have the right to pursue any other remedies legally available to resolve such dispute in either the Courts of the State of Connecticut or in the United States District Court for the District of Connecticut, to whose jurisdiction for such purposes Company and Executive each hereby irrevocably consents and submits.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.
| Biohaven Pharmaceutical, Inc. | |||||
| By: | /s/ Xxxx Xxxxx, M.D. | ||||
Name: Xxxx Xxxxx, M.D. | |||||
Title: CEO | |||||
| /s/ Xxxx Xxxxxx | |||||
| Xxxx Xxxxxx | |||||
EXHIBIT A
Permitted Activities
1. Biohaven Pharmaceutical Holding Company Ltd., a company formed under the laws of the Territory of the British Virgin Islands. Position: CCO
2. Incyte Corporartion, Inc: Consulting services
3. Consulting engagements to biotech industry not in direct competition with Biohaven as described in Section 8 of agreement.
